FDIS, foreign exchange reserves rise in Feb

MANILA (Xinhua) - Indications have showed that the Philippines is well on its way to full economic recovery, a huge inflow of foreign direct investments (FDIS) into the country last year and a surge of foreign exchange reserves to a record high in February this year.

In a statement, the National Statistical Coordination Board ( NSCB) said that total approved FDIS in the country in 2011 reached P256.1 billion ($ 6.03 billion), or a growth of 30. 6 percent from the previous year’s level.

The NSCB, an agency of the National Economic and Development Authority ( NEDA), said this was the highest level of approved FDIS in a single year since 1996. NEDA is the highest economic planning body of the government.

According to NSCB Secretary General Romulo Virola, FDI applications last year also exceeded the P241.1 billion ($ 5.67 billion) recorded in 1997, before the Asian financial crisis hit.

Virola said that of the total FDIS in 2011, the Philippine Economic Zone Authority ( PEZA) accounted for P193.6 billion ($4.56 billion) while the Board of Investments ( BOI) recorded investment commitments worth P23.2 billion ($513.27 million).

Investments registered with PEZA grew by 36.2 percent and with BOI, by 4.1 percent.

In the first two months of this year, investment pledges registered with PEZA surged by 47 percent to P16.22 billion ($ 358.85 million), from P11.04 billion ($259.76 million) in the same period last year, owing to the country’s improved business investment climate.

PEZA Director General Lilia de Lima said that the growth in investment commitments is expected to be sustained until the end of 2012, due to the large number of prospects in the pipeline, particularly projects of Japanese firms that are coming to the Philippines to either relocate or expand their operations.

“This is our banner year.. Our best bet is still Japan ( for investments). I’m very happy with our Japanese investors, they treat our people well, so we want to invite more Japanese investors into the country,” De Lima said last week on the sidelines of the 500,000- unit production milestone of Toyota Motor Philippines Corp.

In terms of country of origin, Japan accounted for P77.4 billion ($ 1.82 billion) of the FDIS approved, accounting for 30.2 percent of last year’s total.

Investment commitments from investors based in the United States reached P70.4 billion ($1.66 billion), or 27.5 percent of total, while P28.3 billion ($665.88 million), or 11.1 percent, came from the Netherlands.

Earlier, the Bangko Sentral ng Pilipinas (BSP), the country’s central bank, also reported that the country’s foreign exchange reserves in February surged further to a record high of P77.77 billion.

The BSP said that the surge in the country’s gross international reserves (GIR) in February was due to foreign currency inflow like remittances and foreign portfolio investments or hot money, dollardenominated loans secured by the national government and earnings by the BSP from its investments in foreign securities.

The latest GIR, an indicator of the country’s ability to service its debts to foreign creditors, pay imports and engage in other forms of commercial transactions with the rest of the world, rose nearly 22 percent from $63.89 billion in the same period last year.